A-11228, NOVEMBER 23, 1925, 5 COMP. GEN. 370

A-11228: Nov 23, 1925

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JURISDICTION - CLAIMS FOR REFUND OF IMPORT DUTIES THE GENERAL ACCOUNTING OFFICE HAS JURISDICTION TO CONSIDER AND SETTLE CLAIMS FOR THE REFUND OF DUTIES ERRONEOUSLY IMPOSED AND COLLECTED ON GOODS THAT ARE NOT "IMPORTED" WITHIN THE MEANING OF THE TARIFF LAWS. THE ISLAND OF PORTO RICO IS A PORT OF THE UNITED STATES IN SO FAR AS THE IMPOSITION OF DUTIES UNDER THE TARIFF LAWS IS CONCERNED. IS AUTHORIZED. IT APPEARS THAT THE SHIPMENT WAS MADE BY THE CANADA CEMENT CO. WAS ENTERED FOR CONSUMPTION AT THE PORT OF MALONE. SUBSEQUENTLY THE GOODS WERE RESHIPPED TO MAYAGUEZ. DUTY WAS AGAIN COLLECTED IN THE SAME AMOUNT AS HAD BEEN PAID AT MALONE. APPLICATION WAS FILED WITH THE TREASURY DEPARTMENT FOR REFUND OF THE AMOUNT PAID AT MAYAGUEZ.

A-11228, NOVEMBER 23, 1925, 5 COMP. GEN. 370

GENERAL ACCOUNTING OFFICE, JURISDICTION - CLAIMS FOR REFUND OF IMPORT DUTIES THE GENERAL ACCOUNTING OFFICE HAS JURISDICTION TO CONSIDER AND SETTLE CLAIMS FOR THE REFUND OF DUTIES ERRONEOUSLY IMPOSED AND COLLECTED ON GOODS THAT ARE NOT "IMPORTED" WITHIN THE MEANING OF THE TARIFF LAWS. THE ISLAND OF PORTO RICO IS A PORT OF THE UNITED STATES IN SO FAR AS THE IMPOSITION OF DUTIES UNDER THE TARIFF LAWS IS CONCERNED, AND REFUND OF IMPORT DUTIES ERRONEOUSLY COLLECTED THEREIN ON GOODS RESHIPPED FROM THE UNITED STATES, AFTER HAVING BEEN IMPORTED INTO THE UNITED STATES AND THE NECESSARY IMPORT DUTIES COLLECTED, IS AUTHORIZED.

COMPTROLLER GENERAL MCCARL TO THE SECRETARY OF THE TREASURY, NOVEMBER 23, 1925:

THERE HAS BEEN RECEIVED YOUR LETTER OF SEPTEMBER 11, 1925, YOUR FILE 111056, TRANSMITTING A COMMUNICATION ADDRESSED TO THE PRESIDENT BY JAMES L. GERRY, TOGETHER WITH OTHER CORRESPONDENCE RELATIVE TO CLAIM FOR $821.70 FOR DUTIES ON A SHIPMENT OF CEMENT PAID TO THE DEPUTY COLLECTOR OF CUSTOMS AT MAYAGUEZ, P.R., DUTIES ON THE SAME SHIPMENT HAVING BEEN PREVIOUSLY PAID TO THE DEPUTY COLLECTOR OF CUSTOMS AT THE PORT OF MALONE, N.Y., UPON ITS ENTRY INTO THE UNITED STATES FROM CANADA.

IT APPEARS THAT THE SHIPMENT WAS MADE BY THE CANADA CEMENT CO., OF MONTREAL, AND WAS ENTERED FOR CONSUMPTION AT THE PORT OF MALONE, N.Y., AND DUTY PAID THEREON IN THE SUM OF $821.70. SUBSEQUENTLY THE GOODS WERE RESHIPPED TO MAYAGUEZ, P.R., AND UPON THEIR ARRIVAL AT THAT POINT IN JANUARY, 1923, DUTY WAS AGAIN COLLECTED IN THE SAME AMOUNT AS HAD BEEN PAID AT MALONE, N.Y., THE SHIPMENT BEING CLASSED AS AN "IMPORT.' DECEMBER 22, 1924, APPLICATION WAS FILED WITH THE TREASURY DEPARTMENT FOR REFUND OF THE AMOUNT PAID AT MAYAGUEZ, WHICH WAS DENIED FOR THE REASON THAT INASMUCH AS SECTION 521 OF THE TARIFF ACT OF 1922, 42 STAT. 973, PROVIDES THAT WHENEVER DUTIES UPON ANY IMPORTED MERCHANDISE HAVE BEEN LIQUIDATED AND PAID AND THE MERCHANDISE DELIVERED TO THE CONSIGNEE OR HIS AGENT, SUCH SETTLEMENT OF DUTIES SHALL, AFTER THE EXPIRATION OF ONE YEAR FROM DATE OF ENTRY, BE FINAL AND CONCLUSIVE IN THE ABSENCE OF A PROTEST, THE TREASURY DEPARTMENT WAS PRECLUDED FROM DIRECTING A REFUND OF ANY PART OF THE DUTIES PAID.

IT WAS THEN SUGGESTED ON BEHALF OF CLAIMANT THAT THE MATTER BE REFERRED TO THE GENERAL ACCOUNTING OFFICE FOR SETTLEMENT, BUT BY LETTER DATED MARCH 7, 1925, THE ASSISTANT SECRETARY OF THE TREASURY ADVISED THE ATTORNEYS FOR THE CLAIMANT THAT THE MATTER WAS NOT A PROPER ONE FOR TRANSMISSION TO THE COMPTROLLER GENERAL FOR CONSIDERATION, AND UNDER DATE OF MAY 8, 1925, REFERENCE TO THE GENERAL ACCOUNTING OFFICE WAS AGAIN REFUSED. A LETTER WAS ADDRESSED THE PRESIDENT SETTING FORTH THE CONTENTIONS OF THE CLAIMANT IN THE MATTER, WHICH LETTER WAS REFERRED TO YOU AND TRANSMITTED TO THIS OFFICE WITHOUT RECOMMENDATION.

THERE IS UNDERSTOOD TO BE NO QUESTION AS TO THE COLLECTION OF DUTY BEING MADE BOTH AT MALONE, N.Y., AND AT MAYAGUEZ, P.R., THE QUESTION FOR DETERMINATION BEING AS TO WHETHER THERE IS ANY LEGAL PROCEDURE BY MEANS OF WHICH THE AMOUNT ILLEGALLY OR ERRONEOUSLY COLLECTED IN THIS CASE MAY BE REFUNDED. SECTIONS 520 AND 521 OF THE TARIFF ACT OF 1922, 42 STAT. 973, PROVIDE THAT:

SEC. 520. REFUND OF EXCESSIVE DUTIES.--- (A) THE SECRETARY OF THE TREASURY IS HEREBY AUTHORIZED TO REFUND DUTIES AND CORRECT ERRORS IN LIQUIDATION OF ENTRIES IN THE FOLLOWING CASES:

(1) WHENEVER IT IS ASCERTAINED ON FINAL LIQUIDATION OR RELIQUIDATION OF AN ENTRY THAT MORE MONEY HAS BEEN DEPOSITED OR PAID THAN WAS REQUIRED BY LAW TO BE SO DEPOSITED OR PAID;

(2) WHENEVER IT IS DETERMINED IN THE MANNER REQUIRED BY LAW THAT ANY FEES, CHARGES, OR EXACTIONS, OTHER THAN DUTIES, HAVE BEEN ERRONEOUSLY COLLECTED;

(3) WHENEVER A MANIFEST CLERICAL ERROR IS DISCOVERED IN ANY ENTRY OR LIQUIDATION WITHIN ONE YEAR AFTER THE DATE OF ENTRY, OR WITHIN SIXTY DAYS AFTER LIQUIDATION WHEN LIQUIDATION IS MADE MORE THAN TEN MONTHS AFTER THE DATE OF ENTRY; AND

(4) WHENEVER DUTIES HAVE BEEN PAID ON HOUSEHOLD OR PERSONAL EFFECTS WHICH BY LAW WERE NOT SUBJECT TO DUTY, NOTWITHSTANDING A PROTEST WAS NOT FILED WITHIN THE TIME AND IN THE MANNER PRESCRIBED BY LAW.

(B) THE NECESSARY MONEYS TO MAKE SUCH REFUNDS ARE HEREBY APPROPRIATED, AND THIS APPROPRIATION SHALL BE DEEMED A PERMANENT AND INDEFINITE APPROPRIATION.

SEC. 521. RELIQUIDATION OF DUTIES.--- WHENEVER ANY MERCHANDISE HAS BEEN ENTERED AND PASSED FREE OF DUTY, AND WHENEVER DUTIES UPON ANY IMPORTED MERCHANDISE HAVE BEEN LIQUIDATED AND PAID, AND THE MERCHANDISE HAS BEEN DELIVERED TO THE CONSIGNEE, OR HIS AGENT, SUCH ENTRY AND PASSAGE FREE OF DUTY AND SUCH SETTLEMENT OF DUTIES SHALL, AFTER THE EXPIRATION OF ONE YEAR FROM THE DATE OF ENTRY, OR AFTER THE EXPIRATION OF SIXTY DAYS AFTER THE DATE OF LIQUIDATION WHEN LIQUIDATION IS MADE MORE THAN TEN MONTHS AFTER THE DATE OF ENTRY, IN THE ABSENCE OF FRAUD AND IN THE ABSENCE OF PROTEST BY THE CONSIGNEE, OR HIS AGENT, OR BY AN AMERICAN MANUFACTURER, PRODUCER, OR WHOLESALER, BE FINAL AND CONCLUSIVE UPON ALL PARTIES. IF THE COLLECTOR FINDS PROBABLE CAUSE TO BELIEVE THERE IS FRAUD IN THE CASE, HE MAY RELIQUIDATE WITHIN TWO YEARS AFTER THE DATE OF ENTRY, OR AFTER THE DATE OF LIQUIDATION WHEN LIQUIDATION IS MADE MORE THAN TEN MONTHS AFTER THE DATE OF ENTRY.

AND SINCE THE AUTHORITY THUS VESTED IN THE SECRETARY OF THE TREASURY TO MAKE REFUND IS LIMITED TO CASES IN THE CLASSES ENUMERATED, THE DECISION THAT THE PROVISIONS JUST QUOTED DO NOT AUTHORIZE YOU TO DIRECT A REFUND IN THIS CASE WAS CORRECT.

IT DOES NOT FOLLOW, HOWEVER, THAT THE CLAIMANT IS THEREFORE WITHOUT REMEDY. THE MATTER HERE PRESENTED DOES NOT INVOLVE A QUESTION AS TO WHETHER THE AMOUNT COLLECTED BY THE COLLECTOR AT MAYAGUEZ WAS THE PROPER AMOUNT DUE UNDER THE TARIFF LAWS, BUT RATHER A MISTAKE OF FACT IN ASSUMING THAT THE GOODS WERE IMPORTED. HAD THEY BEEN IMPORTED, THE FAILURE TO FILE A PROTEST WITHIN THE PRESCRIBED TIME WOULD HAVE BEEN A BAR TO RECOVERY, SINCE THE LIQUIDATION WOULD HAVE BEEN FINAL AND CONCLUSIVE ON ALL PARTIES.

IN THE CASE OF FASSETT V. UNITED STATES, 142 U.S. 479, A VESSEL WAS SEIZED BY THE COLLECTOR OF CUSTOMS IN NEW YORK UNDER THE AUTHORITY OF THE ASSISTANT SECRETARY OF THE TREASURY ON THE GROUND THAT SHE WAS LIABLE TO DUTY. THE OWNER FILED A LIBEL IN THE UNITED STATES DISTRICT COURT, AVERRING THAT THE VESSEL WAS NOT AN IMPORTED ARTICLE, AND THEREFORE NOT LIABLE FOR DUTY. IT WAS CONTENDED ON THE PART OF THE UNITED STATES THAT THE DISTRICT COURT HAD NO JURISDICTION, SINCE THE POSSESSION OF THE COLLECTOR ON BEHALF OF THE UNITED STATES WAS PROVIDED FOR IN THE REVENUE LAWS OF THE UNITED STATES; AND IT WAS FURTHER CONTENDED THAT WHEN THE COLLECTOR DECIDED THAT THE VESSEL WAS DUTIABLE THE ONLY REMEDY OPEN TO HER OWNER WAS TO PAY UNDER PROTEST THE DUTIES ASSESSED UPON HER AND TO PROCEED UNDER THE CUSTOMS ADMINISTRATIVE ACT TO OBTAIN A REFUND OF DUTIES BY TAKING AN APPEAL FROM THE DECISION OF THE COLLECTOR TO THE BOARD OF GENERAL APPRAISERS AND APPEALING, IF NECESSARY, TO THE CIRCUIT COURT OF THE UNITED STATES. IN DECIDING THIS CASE THE COURT HELD THAT THE DECISION OF THE COLLECTOR FROM WHICH APPEALS WERE PROVIDED FOR IN THE CUSTOMS ADMINISTRATIVE ACT WERE ONLY DECISIONS AS TO THE RATES AND AMOUNT OF DUTIES TO BE CHARGED UPON IMPORTED MERCHANDISE AND DECISIONS AS TO DUTIABLE COSTS AND CHARGES, AND THAT THE COLLECTOR HAD NO AUTHORITY TO MAKE ANY DETERMINATION REGARDING ANY ARTICLE WHICH WAS NOT IMPORTED MERCHANDISE. IT NECESSARILY FOLLOWS THAT IF THE COLLECTOR HAS NO AUTHORITY TO MAKE ANY DECISION RELATIVE TO MERCHANDISE NOT IMPORTED THERE CAN BE NO LIQUIDATION BY THE OFFICERS OF THE TREASURY DEPARTMENT NOR ANY DECISION BY THEM WHICH WILL DEPRIVE THE OWNER OF HIS RIGHT TO RECOVER FROM THE UNITED STATES AN AMOUNT WRONGFULLY COLLECTED BY AN OFFICER OR EMPLOYEE OF THE GOVERNMENT WHILE ACTING IN HIS OFFICIAL CAPACITY. IN ORDER TO HAVE THE BENEFIT OF PROCEEDINGS UNDER THE CUSTOMS ADMINISTRATIVE ACT OR UNDER SECTION 521 OF THE TARIFF ACT OF 1922, SUPRA, THE CLAIMANT WOULD HAVE BEEN FORCED TO CONCEDE THAT THE ARTICLES HERE IN QUESTION WERE IMPORTED MERCHANDISE, THE DENIAL OF WHICH IS THE BASIS OF THE CLAIM.

NOT BEING ABLE TO PROCEED UNDER THE CUSTOMS ADMINISTRATIVE ACT HIS REMEDY LIES EITHER IN THE COURTS OR IN THE GENERAL ACCOUNTING OFFICE, THE JURISDICTION OF THE LATTER BEING BASED ON SECTION 236, REVISED STATUTES, AS AMENDED BY THE ACT OF JUNE 10, 1921, 42 STAT. 24, WHICH PROVIDES THAT:

ALL CLAIMS AND DEMANDS WHATEVER BY THE GOVERNMENT OF THE UNITED STATES OR AGAINST IT, AND ALL ACCOUNTS WHATEVER IN WHICH THE GOVERNMENT IS CONCERNED, EITHER AS DEBTOR OR CREDITOR, SHALL BE SETTLED AND ADJUSTED IN THE GENERAL ACCOUNTING OFFICE.

ACCORDINGLY, THE MATTER APPEARS TO BE PROPERLY FOR CONSIDERATION BY THIS OFFICE, SINCE THE CLAIMANT HAS ELECTED TO HAVE THE CLAIM CONSIDERED HERE INSTEAD OF IN THE COURTS.

THERE IS NO CONTENTION THAT THE COLLECTION MADE BY THE DEPUTY COLLECTOR OF CUSTOMS IN PORTO RICO WAS NOT UNLAWFUL, AND THERE WOULD APPEAR TO BE NO ROOM FOR DOUBT IN THE MATTER IN VIEW OF THE DECISIONS OF THE SUPREME COURT IN THE INSULAR CASES, IT BEING HELD IN THE CASE OF DELIMA V. BIDWELL, 182 U.S. 1, QUOTING FROM THE SYLLABUS, THAT,"WITH THE RATIFICATION OF A TREATY OF PEACE BETWEEN THE UNITED STATES AND SPAIN, APRIL 11, 1899, THE ISLAND OF PORTO RICO CEASED TO BE A FOREIGN COUNTRY WITHIN THE MEANING OF THE TARIFF LAWS.' SEE ALSO GOETZE V. UNITED STATES AND CROSSMAN V. UNITED STATES, 182 U.S. 221; DOOLEY V. UNITED STATES, ID. 222, AND ARMSTRONG V. UNITED STATES, ID. 243.

THE AMOUNT HAVING BEEN UNLAWFULLY COLLECTED AND THE RIGHT OF THE CLAIMANT TO REFUND THEREOF ESTABLISHED, THERE REMAINS FOR CONSIDERATION THE QUESTION AS TO THE FUND, IF ANY, FROM WHICH SUCH REFUND CAN BE MADE. UNDER SECTION 4 OF THE ACT OF APRIL 12, 1900, 31 STAT. 78, ALL MONEYS COLLECTED AS DUTIES IN PORTO RICO ARE PAID INTO THE TREASURY OF PORTO RICO AND NOT INTO THE TREASURY OF THE UNITED STATES. HENCE SETTLEMENT CERTIFICATE AND WARRANT MAY NOT ISSUE IN THIS CASE UNDER THE AUTHORITY FOR REFUNDING MONEYS ERRONEOUSLY RECEIVED AND COVERED INTO THE TREASURY, BUT AS IT IS OBVIOUS THAT THE DEPUTY COLLECTOR HAS PAID INTO THE TREASURY OF PORTO RICO AN AMOUNT IN EXCESS OF THAT LEGALLY DUE, HE IS NOW AUTHORIZED TO WITHHOLD OR DEDUCT THE AMOUNT OF SAID EXCESS FROM ANY FUNDS IN HIS POSSESSION OTHERWISE PAYABLE TO THE TREASURY OF PORTO RICO AND TO DRAW A CHECK AGAINST HIS SPECIAL DEPOSIT ACCOUNT IN WHICH HIS COLLECTIONS ARE CARRIED BEFORE BEING PAID TO PORTO RICO FOR THE REFUND OF THE AMOUNT ILLEGALLY COLLECTED, TAKING A PROPERLY RECEIPTED VOUCHER THEREFOR TO BE SUBMITTED WITH REGULAR ACCOUNTS COVERING THE PERIOD IN WHICH SUCH REFUND IS EFFECTED AND THIS DECISION WILL BE HIS AUTHORITY THEREFOR.